One Belt One Road: In the Long Run

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Saman Hamid

Dr. Ishrat Hussain, former Governor State Bank of Pakistan, in one of his articles about CPEC wrote that in a country where cynicism and negativity reigns supreme and fabricated stories media, it is difficult to present a dispassionate analysis on national issues. CPEC; the plan is ambitious and clarifies one thing; Pakistan is not a charity case. A detailed analysis of the strength, weaknesses and subsequent compatibilities with the Western more under developed region of China namely Kashghar prefecture has culminated in China proposing the CPEC initiative and it is much more than infrastructural development. There are five key areas in the plan; agriculture, industry, fiber optics, tourism and financial risks/ management. In this day and age where competition and security risks as well as foreign policy is partly determined by the picture painted by new and old media it is important to examine the plan with less cynicism and greater enthusiasm. As far as the agricultural sector is concerned the most important proposal is to establish “demonstration projects” in around 6500 acres mainly in Punjab area. It is part of exploring potential in the agricultural produce’s supply chain. Investment from seeds, to fertilizers to cold storage areas for fruits, these are all areas Pakistan wanted change in and Chinese are bringing in investment. This perhaps will also pave way for much needed land reform and transfer of ownership as well as some reform to the grass roots, the peasants. Dairy sector is also getting attention as well as meat industry the project will open up Central Asia as well as Africa to Pakistan and China. The technological and knowledge boost Pakistan’s fertile soil had been crying out for is round the corner, we must bear in mind that these proposals are not grants or works of charity and those seeking real economic gains can never be so hence it is high time Pakistan’s agricultural sector welcomes the change on their own terms. Industrial plans divide Pakistan into three zones; western, north-western, southern and central zones. The western and north-western zones rich in mineral resources with little or no potential of exploitation by Pakistanis on their own are finally getting the much needed attention. Of course we need to ensure that our riches are benefiting us proactively hence CPEC’s plan’s examination as well as right lobbying politically will ensure that. The central zone is marked for textiles, household appliances and cement. All three sectors domestically suffer from high costs and cry out for reform, Chinese firms and their subsequent interest will give the right kind of developmental boost to the sectors, of course Pakistanis can sit and wait or they can read into the entire situation and plan and strategize with their Chinese counterparts. This also points towards the massive developmental needs China will have in terms of housing and other projects, which in turn is a market for Pakistanis. The plan cites Gawadar as a base of heavy and chemical industries, such as iron and steel/petrochemical. Gwadar’s superior geographical position allows for economic imports of crude oil from the Middle East, iron ore and coking coal from South Africa and New Zealand. The third sector is Fibre Optics, hinting towards the new economy, Alibaba has recently signed an MoU with Pakistan. A terrestrial cable is planned to be laid down between the two countries as well as a landing station in Gawadar. Digital HD television will also be open for broadcast. Safe City projects such as that in Peshawar and later to major cities of Pakistan hints at how the Chinese plan to secure their interests. The field is of course wide open for Pakistanis to exploit the situation in their favor again prudence and wisdom as well as education is the major ingredient of success. The plan also envisions development of tourism opportunities in congruence with Pakistan’s cultural and religious norms. This aspect of the plan is more at the initial stages. Financial aspects of the plan are through and we must read them thoroughly as a nation and our decision makers must be mindful of the details. The security and political stability are a major concern as well as the inflation rate averaging at 11.6% over the past 6 years. Pakistan’s federal and local governments would share the investment burden by issuing sovereign guarantee bonds. It is also concluded that Pakistan’s economy cannot absorb FDI much above $2 billion per year without giving rise to stresses in its economy. Hence Pakistan’s ceiling for preferential loans is proposed to be $1 billion, and for non preferential loans to be no more than $1.5 billion per year. There are comparisons with East India Company but it is mere propaganda largely from across the border, we are dealing with China and it is strategic partnership and a much needed boost that is a catalyst for our debt trodden economy aching for political, social and economic reform. The Chinese are offering a game changing opportunity that but it is not a charity case and the sooner we get “over” this bond of brotherhood the better. The fact that our rival neighbors are utilizing all means necessary to derail this project is a proof of the potential of this project. Now that the details are revealed proper planning commissions need to step up to the mantel and utilize and take full advantage of the situation. (The author is a freelance writer based in Peshawar)